Did you know that there are more than 7,000 Bitcoin ATMs in the world? That’s a sure sign that cryptocurrency is here to stay and it’s only going to grow.
If you’re new to the cryptocurrency game, you have a lot of questions. What is cryptocurrency? Is it worth the investment? What are the various tools to use, like governance tokens?
This cryptocurrency guide gives you the lowdown on the basics of investing in this new market.
A Brief Investing in Cryptocurrency Guide
At the heart of cryptocurrency and the reason why it’s so attractive to investors is that it is decentralized. Bitcoin, Ripple, EOS, and Ethereum are all decentralized currencies.
There isn’t a centralized bank like The Fed that oversees interest rates and makes decisions to manipulate the market. The main goal of The Fed is to keep interest rates steady and inflation low so the economy remains secure. Centralized banks do this all over the world.
With cryptocurrency, there isn’t a centralized bank that oversees it. It functions across peer-to-peer networks.
On the downside, the decentralization leaves the currency subject to big swings. Public perception will play a larger role in the value of cryptocurrency.
How to Invest in Cryptocurrency
Are you ready to get started investing in cryptocurrency? Get ready to head to one of the hundreds of cryptocurrency exchanges. Coinbase Pro (formerly GDAx), Robinhood, and Coinbase are among the most popular exchanges.
You want to make sure that you invest someplace where your information is secure. You have to connect your bank information to the account.
Learning the Lingo
You’ll need to learn the lingo of cryptocurrency to be a good investor. One of the first ones to know is governance tokens.
Since cryptocurrency is decentralized, anyone can wield influence. That is anyone with governance tokens. You use these tokens in a similar way that a stockholder amasses shares to gain more influence.
Learn more about governance tokens and how you can use them to your advantage.
Another term you’ll come across is mining. This is where people (miners) set up high-performance computers to perform very complex problems. When these problems are solved, new bitcoin is created.
What kinds of problems does mining solve? It’s involved in validating transactions, which keep the whole system secure.
Bitcoin mining is very popular because the rewards are usually great. Miners get rewarded by the number of validations processed.
The costs are very high though. Miners have to invest in powerful computers and take the time to program the machines to perform complex mathematical problems.
A Cryptocurrency Guide for Beginners
Why is cryptocurrency so attractive to investors? It’s a decentralized financial system that relies on people, instead of politicians.
Before you invest in cryptocurrency, make sure you find a solid trading exchange that is safe and secure. You’ll want to spend a lot of time learning about different aspects of cryptocurrency, like governance tokens and bitcoin mining.
You’re a smarter investor now that you read this cryptocurrency guide. Head over to the Finance section of this site for more smart financial tips.